Dial Red for Recovery

Two cell-phone companies in Haiti have outshone the government, the NGOs, and the international community in reconstructing post-earthquake Haiti. How -- and why -- did they do it?

BY AMY BRACKEN | JANUARY 11, 2011

So Digicel created its own infrastructure. Instead of waiting for the government, the company built roads to many of its sites and kept its reception towers going with hundreds of generators. Annual diesel costs alone are in the millions. All in all, Digicel has poured more than $400 million in Haiti -- more than any other international company ever. Phone prices have dropped from $100-plus to just $10, with free minutes on offer. Yet the company is turning out a profit.

More recently, in addition to building infrastructure and other social goods -- things that served their own network as much as Haitians themselves -- Digicel began to invest directly in charity. "They wanted to be big in the market," says Kesner Pharel, a Haitian economic consultant based in Port-au-Prince, "So they gave $1 million to the soccer federation. Haitians love soccer so much, so it was a good thing for them. They invested in education, and Haitian people love investing in education for our kids."

Some called it the Digicel Revolution, or the "red wave": a visible sweep of red-hued advertising that covered the roofs and walls of entire neighborhoods. But rather than swamping the competition, Digicel forced it to adopt similar tactics to stay competitive. Voila, which had opened in Haiti in 1998 under the name Comcel, also reduced prices and increased corporate social responsibility, funding programs that sound very similar to Digicel's: scholarships, soccer programs for at-risk kids, and so on.

In the aftermath of the earthquake, the cell-phone companies have continued to provide the same level of corporate support, despite losing millions of dollars in equipment. They have provided free minutes for customers to call for help and reach loved ones. They gave out emergency aid in the form of shelter, medicine, food, and water, with Digicel Foundation spending more than $20 million on relief alone. And both companies now work with NGOs to provide cholera education in the form of text messages.

On Jan. 11, a celebration unveiled the only reconstructed building in the pummeled downtown business district. The historic Marché Hyppolite, a lofty metal marketplace that was demolished in the earthquake, is now open for business, an elegant, turreted structure that gleams amid the grime. And it's all thanks to Digicel, whose billionaire founder, Denis O'Brien, paid for the reconstruction himself and coordinated with the city of Port-au-Prince to carry it out.

Clearly, whatever they are doing is working to help rebuild Haiti -- and brand loyalty. A public opinion study conducted last summer by Pharel's consulting firm shows a widespread love of the two companies, especially Digicel.

CEOs of both companies say their programs help the country while helping themselves. For Voila CEO Robin Padberg, helping Haiti develop means more potential business: "If we as a society can raise the bar and create a better standard of living, then for us as a company we have a much larger target and subscriber pool."

THONY BELIZAIRE/AFP/Getty Images

 

Amy Bracken is a freelance journalist based in Boston who frequently visits Haiti.

THE GLOBALIZER

2:55 PM ET

January 12, 2011

Is this what a small government country ultimately looks like?

Notwithstanding the obvious historical issues and the damage from the earthquake, it does make me wonder what a developed country with a microscopic government could or would look like. We've seen similar examples of private provision of public services in places like India as well -- while such a scenario may lack the ideal of "universal access" as in the US and EU, it does seem that public services could be provided with private sector subsidies (and the corresponding logos/branding) and at relatively low cost to the public at large.

And shhh, at its core it would actually be more a progressive tax policy than current US policy, by de facto taxing consumption (increased prices of the services sold by those companies) rather than income.

Haiti is by no means a perfect surrogate, but it is food for thought, if nothing else. Nice story.

 

SELENACA806

4:45 PM ET

February 10, 2011

The past year in Haiti has

The past year in Haiti has been marked by the slow pace of the earthquake recovery. But the poorest nation in the hemisphere is moving quickly on something else — setting up “mobile money” networks to allow cell phones to serve as debit cards. The systems have the potential to allow Haitians to receive remittances from abroad, send cash to relatives across town or across the country, buy groceries and even pay for a bus ride all with a few taps on their cell phone plans. Haitians are already accustomed to buying cell-phone minutes electronically from vendors on the street. A vendor uses his phone to put extra time on your phone. You instantly get a message on your handset showing your new balance. Then you can re-send that cell phone credit again via text message to someone else.